Applied Mathematics and Nonlinear Sciences
Journal license

Journal

Applied Mathematics and Nonlinear Sciences


Volume
& Issue

Volume 7, Issue 2


Published
on

July 15, 2022


Pages

757-766


DOI

Article

Nonlinear Differential Equations in Preventing Financial Risks

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Authors

Xiangli Meng Affiliation:
Finance Department of Jinzhou Medical University, Jinzhou, 121001, China
, Rongquan Liu Affiliation:
Audit Office of Jinzhou Medical University, Jinzhou, 121001, China.
, Mohammed Qeshta Affiliation:
College of Administrative Sciences, Applied Science University, Bahrain
and Audil Rashid Affiliation:
College of Business Administration, American University of the Middle East, Egaila, Al Ahmadi, Kuwait


Abstract

The nonlinear differential equation option pricing formula is invaluable in financial derivatives investment risk assessment. This article applies the theory of nonlinear differential equations to deal with financial risks in commodity and currency markets. Through this condition, we obtain the fair price process of contingent rights under the classic Black-Scholes model and the price process of the optimal growth investment strategy. The results show that the risk measurement under stable distribution is suitable for investors to manage risk.


Keywords

Nonlinear differential equations, Financial risks, Partial differential equations, Financial derivatives, 34A34


Citation

Meng, X., Liu, R., Qeshta, M., & Rashid, A. (2022). Nonlinear differential equations in preventing financial risks. Applied Mathematics and Nonlinear Sciences, 7(2), 757–766. https://doi.org/10.2478/amns.2022.2.0063

Published by: Engineering Journals

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